Firstgroup suffered a slump in first-half profits despite revenue rising five per cent to £2.9billion.

However, increased fuel hedging costs and declining customer revenues in some areas, particularly in America, meant pre-tax profits were down from £54.4million to £30.3m.

Sir Moir Lockhead, chief executive, said trading was in line with expectations. He said: "While the current economic environment presents a number of challenges for the transport industry, the board remains confident in the underlying strength and resilience of the group.

"The actions we have taken across the business to reduce costs will ensure the group is well placed to benefit from future economic recovery."